By an 8-7 vote on Thursday, a federal appeals court has struck down MCRI, the Michigan Civil Rights Initiative.

Known as Proposal 2 in 2006, Michigan voters overwhelmingly approved it. The law says universities and other public entities in this state cannot use race to give preferential treatment in admission or hiring.

Michigan Attorney General Bill Schuette already said he plans to appeal to the U.S. Supreme Court.

To understand the history of MCRI you need to go back to 1995. Jennifer Gratz, a white high school student, applied to the University of Michigan and was waitlisted while other students at her school with lesser grades and test scores were admitted. The difference? Those admitted were minorities.

Gratz and another student sued the University of Michigan over its race preferences and won at the Supreme Court level. That victory put MCRI into motion and ultimate victory in 2006.

Ever since it became law, various groups have been suing to overturn it, including the ACLU.

"We are thrilled with today's landmark decision. It is a tremendous victory for racial justice and access to democracy," said Michael Steinberg, ACLU Director in Michigan.

Gratz calls the decision flawed.

"I think it’s outrageous. With all due respect to the court, they do not have the right to overturn the will of the people and declare equality unconstitutional in Michigan," she said.

Schuette says he's going to fight it out at the Supreme Court. Now, the question is will the highest court hear the case.

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